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From the moment we are born, we are bombarded by social queues for what we should and shouldn't do. These signals serve a valuable purpose in teaching us how to communicate and interact with others, how to evaluate decisions, and how to react under different circumstances.

As children, we stumble over the faux pas line frequently, and there is usually somebody there to kindly guide us in the right direction. I vaguely recall wanting to wear my bathrobe to school one day when I was about 5. Open-minded as she was, my mother gently convinced me that even though my bathrobe was more comfortable, and did make me look somewhat like a wizard, that I would probably feel out of place among the other children.

Inherent in the choice between following the conventional wisdom and breaking established norms is an asymmetrical outcomes profile. Whether your choice turns out to be "right" or "wrong," you will always bear a social loss. Consider the following scenario:

Everybody starts taking a new health supplement that increases intelligence.

a) Peter decides to take it daily because he wants to be smart, and the experts say it's safe.

b) Jose avoids the supplements because he doesn't trust the experts.

Now, imagine that the supplements turn out to be just as fantastic as advertised. All of the people who took them would get both the benefit of greater intelligence and the social benefit of being accepted by their peers. Naysayers like Jose would be "weird."

However, if it turns out that the supplements actually cause heart disease, then despite the physical detriments that users would experience, they would still be socially accepted. "Everybody was doing it," "The experts said it was safe," "Nobody could have seen this coming." Even though Jose avoided following the trend, he could still be considered a bit odd, but more likely, just lucky.

Let's apply this phenomenon to a broader economic context. Consider the following examples where the pain of being wrong was outstripped by the pain of being weird.

1) In 1998, if you weren't buying stocks, you were weird.

2) In 2005, if you weren't buying a house, you were weird, and probably stupid.

3) In 2007, if you weren't paying top dollar to attend a 4-year college, you were gambling with your future.

And what happened? Stocks plummeted, housing crashed, and US citizens wracked up over $1 trillion of outstanding student loans, which now stands in conjunction with a 16-24 year old unemployment rate of about 50%. Yes, you heard that right: 50%.

The third example I believe is also the most painful to discuss, as so many people were told at the age of 18, "here, sign this paper" without thinking twice about the real magnitude or future burden of their debt. I acknowledge that this is a sensitive matter to many individuals and families. People always have to make very tough choices about their education, career, and the amount of money that it's worth to get a college education. It's also not obvious that those who eschewed higher education in favor of working straight out of high school have fared much better. But among this cohort, even if someone is unemployed, at least they aren't dealing with soul-crushing debt.

How can we apply this understand today? How can we distinguish between conventional wisdom that actually makes sense (i.e. don't speculate with money you can't afford to lose), and the kind of herd mentality that traps us in a deadly lemming march towards the ocean?

1) Keep a lookout for the phrase "everybody knows..." since if this were actually the case then there would be no need to repeat it.

2) Try to admit to yourself whether you're following conventional wisdom because you believe it to be true or because you aren't too fearful of the repercussions of it being wrong.

3) Keep an ear tuned to the crazy naysayers on the street corner. One of them might be saying something that makes sense.

4) Chart your own path, and do what is right for you and your family, regardless of how your behavior appears to others.